Business Directories

US loses top donor status to Britain

Berlin, January 12, 2008

The United States lost its status as the largest donor to the World Bank's main fund for poor countries, the lender said on Friday, as Britain pledged more in the latest funding round that secured a record amount of aid.

Losing its position as the top donor could weaken Washington's influence over the World Bank, which is the largest provider of development assistance to poor countries, and over the policies that decide how its cash is spent.

The Washington-based lender conducts a fund-raising campaign among its richer members every three years to determine funding for the International Development Association. The IDA is the bank's lending arm.

After negotiations that began in March in Paris and ended with two days of talks in Berlin, Britain promised $4.2 billion for the period from July 2008 through June 2011, World Bank President Robert Zoellick told reporters in a conference call.

The US Treasury said it pledged $3.7 billion to the bank's International Development Association fund, up 30 per cent from its contribution three years ago and the largest increase since the Carter administration in the 1970s.

A senior Treasury official applauded Britain's move, which amounts to an increase of about 50 percent.

"We made our decision based on what we thought was a solid number - one of the largest increases the United States has ever made - and the UK obviously put in an even greater amount, which means that the overall number for IDA goes up. We think it's great what the UK did," said Clay Lowery, Treasury assistant secretary for international affairs.

Lowery said the United States "has no problem" with Britain being a larger donor, adding that it is "good for poor people, which is frankly what we're mostly concerned about."-Reuters